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August 23, 2019Cart

Business

by Fairfield County Business Journal
by FCBJ

Connecticut finished fiscal 2016-17 with $22.7 million deficit

Connecticut ended the 2016-17 fiscal year with a $22.7 million deficit, its third consecutive year in the red, according to Comptroller Kevin Lembo.

As of Sept. 30, the state’s Rainy Day Fund stood at $212.9 million, or 1.2 percent of last fiscal year’s General Fund. 

The deficit was “largely driven by underperforming revenue collections,” according to a letter Lembo wrote to Gov. Dannel Malloy. Personal income tax receipts were about $530 million less than anticipated, while sales tax income was $136.5 million below budgeted levels.

On the other hand, corporate tax receipts were $198 million higher than expected and the state spent $407 million less than the appropriated level last fiscal year. In total, General Fund spending dropped $158 million from the previous fiscal year.

Concurrently, retirement and other costs once again caused fiscal pain. Payments on bonded debt rose by $104 million or almost 6 percent last fiscal year, while health care benefits for retired state employees rose by $61 million or 9.4 percent, according to Lembo.

The comptroller also noted that payments into the state employee and teacher pension programs rose by $65 million or 3.1 percent last fiscal year. Those costs are expected to increase by $356 million, or almost 17 percent, this fiscal year.